Rec Silicon Asa · OSL:RECSI
Rec Silicon Asa — Q4 2020 Earnings Presentation
36 slides from Rec Silicon Asa's earnings presentation, Feb 18, 2021
Slide 1: Fourth Quarter 2020 Presentation
FOURTH QUARTER 2020 FOURTH QUARTER 2020 1 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 PRESENTATION
Slide 2: Disclaimer
FOURTH QUARTER Disclaimer 2020 This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this presentation are based on current expectations, estimates
Slide 3: Agenda
FOURTH QUARTER Agenda 2020 Q4 Results Tore Torvund Financial Review James A May II Silicon Gases & Semiconductor Update Kurt Levens PV Market Update & Non-Chinese Solar Value Francine Sullivan Chain Chuck Sutton Yulin JV Update Tore Torvund Battery Update Francine Sullivan Short-term Business Plan T
Slide 4: Fourth Quarter Highlights
FOURTH QUARTER Fourth Quarter Highlights 2020 Revenues: $36.0M EBITDA: $ 1.9M December 31, 2020 cash balance of $134.9M Solar Materials Developments - Cash increase of $99.0M - Increases in PV demand is driving polysilicon - Cash outflows from operating activities of $2.8M prices higher - Private pl
Slide 5: Financial Review
FOURTH QUARTER 2020 Financial Review 5 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 James A May II
Slide 6: Summary of Segments
FOURTH QUARTER Summary of Segments 2020 (USD million) Q4 2020 2020 2019 Revenues EBITDA Revenues EBITDA Revenues EBITDA Semiconductor Materials 35.9 11.7 121.4 36.3 126.7 37.8 Solar Materials 0.1 (2.8) 0.5 6.7 33.4 (26.6) Other 0.0 (7.0) 0.1 (19.3) 0.0 (24.1) Eliminations - - - - 0.0 0.0 REC Silicon
Slide 7: Key Financial Results – Semiconductor Materials
FOURTH QUARTER Key Financial Results – Semiconductor Materials 2020 Revenues EBITDA $40 M Revenues: $35.9M (18.3% increase vs. Q3’20) $35.9 › Polysilicon sales volumes 338MT (15.6% decrease vs. 401MT in Q3’20) - Semiconductor grade volumes 250MT $30 M $30.7 $30.0 $30.3 (43.9% increase vs. 174MT in Q
Slide 8: Key Financial Results – Solar Materials and Other
FOURTH QUARTER Key Financial Results – Solar Materials and Other 2020 Revenues EBITDA (Solar Materials) EBITDA (Other & Eliminations) $20 M Solar Materials $10 M Revenues: $0.1M $14.6 EBITDA Contribution: ($2.8M) Loss › Net Expense of $2.8M $1.7 $0.2 $0.3 $0.1 - Comparable to prior period results ex
Slide 9: Cash Flows
FOURTH QUARTER Cash Flows 2020 $60 Cash outflows from operating activities $2.8M › EBITDA of $1.9M › Working capital decrease $0.4M $50 - Decrease in inventories $5.5M - Increase in receivables ($4.9M) - Decrease in payables and accruals ($0.2M) USD million › Interest paid ($8.5M) $40 $1.9 $0.4 › US
Slide 10: Debt
FOURTH QUARTER Debt 2020 Debt maturity profile USD Million C.A.R.E.S. Act Loan Nominal debt - $220.6M Indemnity Loan Lease Liabilities › Decrease of $0.8M in Q4’20 Note - Property Tax Settlement - ($0.4M) Decrease in Lease Liabilities (IFRS 16) USD Senior Secured Bond - ($2.8M) Decrease in Property
Slide 11: Silicon Gases and Semiconductor
Silicon Gases and Semiconductor Kurt Levens
Slide 12: Electronic Grade Polysilicon Increase
FOURTH QUARTER Electronic Grade Polysilicon Increase 2020 REC Shipments - Semiconductor Polysilicon 300 › Q4 in line with stronger H2 2020 - 250MT in Q4’20 vs. 174MT in Q3’20 - Customer prep for operations 250 during Lunar New Year period - Strongest shipment quarter since 200 2018 Metric tons › 202
Slide 13: Silicon Gas Shipments Respond to Demand
FOURTH QUARTER Silicon Gas Shipments Respond to Demand 2020 › Increase in Silicon Gas shipments - Less inventory in supply chain – Silicon Gases Quicker response - 1,000 Semi and FPD remained at high utilization - Logistics cycle times increasing due 800 to Ocean Freight - Q1 firming up to be strong
Slide 14: REC Silicon Products
FOURTH QUARTER REC Silicon Products 2020 REC Silicon produces FZ rods, EG CZ rods/chunk, Silicon Gases – All value creation starts with Silane Production Siemens Process REC Products Process Key Inputs: Polysilicon FZ: Rods Ground MGS Siemens Reactor FZ & CZ Rods / Chunk •Electricity rods •Pressure
Slide 15: REC Silicon Product Applications
FOURTH QUARTER REC Silicon Product Applications 2020 Float Zone FZ Crystal Pulling Power Polysilicon Source and Wafering Semiconductor Rods Czochralski CZ Crystal Pulling Consumer Polysilicon Chunk and Wafering Electronics Silane Chemical Vapor Semiconductor, Deposition Flat Panel (TFT), PV Dichloro
Slide 16: Basic Semiconductor Manufacturing Process
FOURTH QUARTER Basic Semiconductor Manufacturing Process 2020 16 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 17: Unit Volume Growth Resumes & Content Increases
FOURTH QUARTER Unit Volume Growth Resumes & Content Increases 2020 17 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 18: Semiconductor Unit Growth Forecast
FOURTH QUARTER Semiconductor Unit Growth Forecast 2020 Source: IC Insights, Inc. – Global Wafer Capacity 2021-2025. 18 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 19: REC Silicon Aligned with present & future market leaders
FOURTH QUARTER REC Silicon Aligned with present & future market leaders 2020 19 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 20: Strong Growth favors REC Global presence & position for Silane
FOURTH QUARTER Strong Growth favors REC Global presence & position for Silane 2020 20 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 21: Advanced Semiconductor Processes drive Silicon Gas Portfolio
FOURTH QUARTER Advanced Semiconductor Processes drive Silicon Gas Portfolio 2020 21 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 22: PV Market Outlook
FOURTH QUARTER 2020 PV Market Outlook 22 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 Francine Sullivan, Chuck Sutton
Slide 23: Outside China Solar Value Chain
FOURTH QUARTER Outside China Solar Value Chain 2020 › Biden Administration elected on green energy transformation platform - Decarbonization & deployment of renewable energy - Buy American & create high paying manufacturing jobs - Specific policies under development, likely to form part of future st
Slide 24: PV Demand Forecast Increasing
FOURTH QUARTER PV Demand Forecast Increasing 2020 › China Global Installation Outlook - 55-58 GW in 2021 350 - Yearly growth 300 › US - Investment Tax Credit (ITC) Extension 250 - 23-26 GW annually next 3 years - Expect further installation support 200 150 › EU - 25-30GW in 2021Low Carbon focus 100
Slide 25: United States Market Increases
FOURTH QUARTER United States Market Increases 2020 › ITC extension to support Forecast before ITC Extension increased installations next 3 years › Additional 15GW of installations due to ITC extension › Presidential Executive Orders lead to positive directives on clean energy purchasing and support
Slide 26: Polysilicon Pricing
FOURTH QUARTER Polysilicon Pricing 2020 Polysilicon Pricing 16.00 › Pricing volatility in 2020 due 14.00 COVID-19 and factory incidents 12.00 › End of year pricing increased 10.00 due to demand 8.00 › 2021 pricing may increase due 6.00 to limited polysilicon capacity available 4.00 › Pricing support
Slide 27: Yulin JV Update
FOURTH QUARTER 2020 Yulin JV Update 27 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021
Slide 28: Yulin JV, China
FOURTH QUARTER Yulin JV, China 2020 Plant characteristics Current Status › Construction completed in 2018 › Delay in Equity Settlement Payment of $4.7M › Large scale silicon manufacturing facility with Due to: - 19,000 MT FBR-B granular Polysilicon - Outstanding invoices from REC - 300 MT Siemens se
Slide 29: Battery Opportunities
FOURTH QUARTER 2020 Battery Opportunities 29 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 Francine Sullivan
Slide 30: Electrification Transition: Silicon Increases Battery Performance
FOURTH Electrification Transition QUARTER Silicon Increases Battery Performance 2020 EV Market Investments and Expansion Silane SiH4 in Next Generation Advanced Anode Material › Battery/EV industry experiencing significant tailwind › Next generation silicon anode materials using silane › Numerous ne
Slide 31: Cooperation with Group14 – a Silicon Anode Leader
FOURTH QUARTER Cooperation with Group14 – a Silicon Anode Leader 2020 Group14 Partnership › First commercial scale silicon anode manufacturing plant globally › Group14 Technologies (Group 14) plans to build 12,000MT nameplate capacity advanced silicon anode manufacturing plant co-located at REC’s fa
Slide 32: REC well positioned to supply global market
FOURTH QUARTER REC well positioned to supply global market 2020 REC Silicon Moses Lake Market Leading Si Anode Makers › REC Silicon supplying silane to Next Generation Silicon Anode REC Silicon several silane anode industry Manufacturing Moses Lake, WA leaders, including those partnering Moses Lake,
Slide 33: Short Term Business Plan
FOURTH QUARTER 2020 Short Term Business Plan 33 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 Tore Torvund
Slide 34: Silane: Feedstock for the Energy Transition
FOURTH QUARTER Silane: Feedstock for the Energy Transition 2020 SILANE BATTERY VALUE SEMICONDUCTOR SOLAR VALUE CHAIN CHAIN Proven Established Footprint Silicon Anodes to Drive Global Leader to Capture Solar Silane Market …………….. Market Upside Expansion ……………………………… …………………………… Butte Moses Lake Moses
Slide 35: First quarter 2021 business plan for REC Silicon
FOURTH QUARTER First quarter 2021 business plan for REC Silicon 2020 › Stronger financial position creates business opportunities - Implement previously identified business opportunities with limited investment and high return › Focus efforts on restart of the Moses Lake plant pursuing the following
Slide 36: Q1 2021 Reporting May 11, 2021
FOURTH QUARTER 2020 Q1 2021 Reporting May 11, 2021 36 © REC Silicon ASA. All rights reserved. Confidential February 19, 2021 recsilicon.com